This past year has been a tumultuous one with a global pandemic devastating human lives and economies across the globe. As economic activity abruptly stalled due to Covid-19, energy-related CO2 emissions fell sharply enough to give the planet a chance to breathe. The changes in human activity brought about by lockdown measures resulted in a historic 8.8 % decrease in global carbon dioxide (CO2) emissions – nearly 1,550 million metric tons – during the first half of 2020, according to a recent study published by Nature Communications.1
These stark reductions highlight not only the difficult challenges ahead to limit global warming effects but also shed light on the real possibility of accelerating the decarbonization of our planet through changes to our personal energy consumption behavior and energy structure. But how much change is needed? The UN Environment Protection Programme (UNEP) has warned that unless global greenhouse (GHG) emissions continue to fall by 7.6 % each year between 2020 and 2030, the world will miss its chance of limiting global warming by the 1.5 degrees Celsius goal established by the Paris climate agreement.2
Despite the decline in emissions, America remains a top polluter.
Before Covid-19 entered the picture, U.S. energy-related CO2 emissions decreased in 2019 by 2.8 % when compared to 2018, according to a September 2020 U.S. Energy Information Administration (EIA) emissions report.3 Per capita emissions were lower in 2019 than they have been at any time since 1950; however, the country remains among the world’s top polluters in absolute terms. The World Resources Institute (WRI) asserts the U.S. generates 12.8 % of global emissions, second only in line to China, contributing 25.76 %.4
The U.S. Environmental Protection Agency (EPA) tracks the primary sources of GHG emissions in the United States, noting that human activities are to blame for almost all of the atmosphere’s increase over the last 150 years.5 It divides up the emission sources as follows: transportation (28%), electricity production (27%), industry (22%), commercial and residential (12%), and agriculture (10%). Whether or not the U.S. rejoins the Paris agreement under future national leadership, much still needs to be done across these sectors to mitigate climate risk.
The largest U.S. companies are taking the climate threat seriously.
Reassuringly, sustainability initiatives are becoming more prevalent for companies across the world. The Harvard Business Review reported in 2019 that among 1,000 CEOs of large companies who participated in an Accenture study, 99% of them agreed that “sustainability issues are important to the future success of their businesses.” The report also notes that CEOs understand the need for system-level change to tackle issues as big as climate.6 This sentiment is evident across the S&P 500 Index, where 90% of its companies published sustainability reports.7
Being immersed in the energy management market, Encycle finds it fascinating to watch how companies embark on more sustainable journeys. We took a look at some of the largest U.S. companies and discovered that even amidst one of the most challenging business years in modern history, they either held firm on their sustainability efforts or broadened them. These companies demonstrate unprecedented leadership by setting science-based GHG reduction targets and developing transparent plans to help achieve them:
The retail and cloud giant’s overall climate pledge is to be net carbon zero by 2040 and reach 100% renewable energy by 2025. In June of 2020, Amazon launched a $2 billion Climate Pledge Fund to invest in companies creating products, services, and technologies to protect the planet. The fund is expected to accelerate investment in innovations for the zero-carbon economy of the future. To date, Amazon has announced 91 renewable energy projects around the globe. Together, these projects totaling over 2,900 MW of capacity will deliver more than 7.6 million MWh of renewable energy annually. Additional areas of progress or commitments include:
- Since 2015, Amazon has reduced the weight of outbound packaging by 33% and eliminated more than 880,000 tons of packaging material
- Amazon has pledged to purchase 100,000 custom electric delivery vehicles by 2030, optimized for safety, functionality, and delivery
- Amazon Air has secured up to six million gallons of sustainable aviation fuel (SAF) supplied by Shell Aviation and produced by World Energy
- Amazon Web Services has demonstrated a commitment to water stewardship, reducing or reusing water in its data centers
Source: Amazon website
In September of 2020, AT&T announced its commitment to be carbon neutral across its entire global operations by 2035. The modern media company says it is also expanding its Climate Change Analysis Tool (CCAT) across the U.S. to identify the potential impacts of climate change on its network and operations now and in the future. AT&T plans to achieve its ambitious carbon-neutral goals by focusing on several key initiatives:
1) Virtualization of many network functions – AT&T is eliminating significant portions of
energy-intense network equipment, relying instead on low-cost, energy-efficient
hardware. The company currently has 75% of its core network functions virtualized.
2) Transitioning to a low-emissions fleet – AT&T is optimizing fleet routes, switching to
hybrid vehicles, and reducing the overall size of its fleet with plans for fleet
3) Accelerating energy efficiency and network optimization efforts – The company
says it implements thousands of energy efficiency projects across its network and
operations, bringing down electricity use.
4) Expanding sustainable feature film and TV production – This occurs through the use
of cleantech solutions, sustainable products, and reuse / waste reduction efforts.
5) Supporting the renewable energy marketplace – AT&T has entered into power
purchase agreements with renewable energy developers, reducing its emissions
6) Investing in carbon offsets – Where sources of emissions cannot be eliminated,
AT&T will invest in carbon offsets to cover the associated emissions.
Source: AT&T website
In May of 2020, CVS Health unveiled Transform Health 2030, the company’s new corporate social responsibility (CSR) roadmap for the next decade. The CSR is aimed to support the health of CVS’s business, people, communities, and the planet. The company’s Healthy Planet initiatives include a commitment to reduce absolute GHG emissions by 36% by 2030. To date, CVS has converted nearly 1,000 retail locations to interior LED lighting, reducing energy consumption by 47,000-megawatt hours (MWh). Almost 54% of CVS’s waste has been diverted to recycling or reuse, with 88% of cardboard and 88% of solid waste generated at distribution centers diverted for recycling. Other notable efforts include:
- The redesigning of products and packaging to reduce the consumption of natural resources
- A digital receipt program at CVS Pharmacy reduces paper use and provides customers with a more sustainable option at checkout
- In the transportation supply chain, CVS has consolidated its freight network to reduce lead time and the miles each pallet travels
- The addition of solar panels to more than 130 delivery trailers for electric charging of pallet jacks at distribution centers
Source: CVS Health 2019 Corporate Social Responsibility Report
As one of the largest grocery chains in the U.S., Kroger has 2,757 retail locations, 44 distribution centers, and 34 manufacturing plants that contribute to its energy and carbon impact. Its Retail team has achieved 47.4% electricity savings in its supermarkets since 2000. Kroger recently set a new science-based goal to reduce absolute GHG emissions from its operations by 30% by 2030. In 2019, the company reduced electricity consumption by 2.7%, driven primarily by store efficiency improvements. Additional energy-saving initiatives include:
- Integration of energy-efficient features in new and existing stores
- Installation of energy management systems (EMS) in several manufacturing plants
- Continuous upgrade of fleets, including the investment of electric vehicles
- Solar power installations across multiple distribution centers, manufacturing plants, and stores
- Participation in the EPA’s GreenChill program designed to minimize refrigerants that deplete the ozone
Kroger’s sustainability commitment also focuses on preventing waste where possible and then diverting it from landfills in an effort to become a zero-waste company. Its stores donate millions of pounds of unsalable food to those in need, reducing food that goes to waste.
Source: Kroger 2020 Environmental, Social and Governance Report
Microsoft has been carbon neutral across the world since 2012 and has committed to being carbon negative by 2030. Among the largest purchasers of renewable energy, the company’s sustainability initiatives focus on carbon, water, waste, and biodiversity. Microsoft’s most recent suite of sustainable efforts include:
- The removal of one million metric tons of carbon from the environment to negate the carbon it produced over its lifespan
- The launch of Transform to Net Zero, a coalition of nine corporations, enabling cross-sector collaboration to accelerate action toward a net-zero carbon economy
- A 500-megawatt renewable energy investment through Sol Systems with assets earmarked for communities that face disproportionate environmental challenges
- A pledge to eliminate its dependency on diesel fuel by 2030
- The elimination of single-use plastics in packaging by 2025 and increased reuse at data centers with Circular Centers
- The unveiling of the Microsoft Sustainability Calculator, a new product offering designed to provide cloud customers transparency into their cloud usage
Source: Microsoft website
Procter & Gamble
In 2018, Procter & Gamble (P&G) released a new set of broad-reaching sustainability goals called Ambition 2030. P&G now purchases 100% renewable energy in the U.S., Canada, and Western Europe. The company has cut GHG emission in half at its sites, and over 90% of its manufacturing plants are Zero Manufacturing Waste to Landfill. P&G is committed to being carbon neutral for the decade and accelerating efforts to curb climate change. Other sustainable initiatives include:
- The aim to deliver a 35% increase in water efficiency
- A focus to advance at least 10 significant supply chain partnerships to drive circularity on climate, water, or waste
- Increased use of Forest Stewardship Council® certified fiber to 75% across all Family Care brands by 2025
- The commitment to achieve 100% recyclable or reusable packaging by 2030
- The funding of a wide range of projects designed to protect, improve, or restore forests, wetlands, grasslands, and wetlands
Source: Procter & Gamble website
“Starbucks aspires to be a resource-positive company” according Kevin Johnson, Starbucks president and chief executive officer. In January of 2020, the company announced its participation in Transform to Net Zero. Along with eight other founding companies, the initiative aims to accelerate the course for businesses to achieve net zero emissions by 2050. Worldwide in 2019, 72% of Starbucks’s global operations were powered by renewable energy. The company’s goal is to invest in 100% renewable energy to power operations globally by the end of 2020. Starbucks has built more than 1,600 LEED®-certified stores around the world and plans to build and operate 10,000 greener stores globally by 2025. Other noteworthy initiatives include:
- Cup recycling trials in major cities
- Continued rollout of strawless lids and sustainable material straws
- The goal to increase hot cup recycled content to 20%
- The encouragement of customer adoption of reusable cups with a 2.8% reusability rate in measured markets
Sources: Starbucks 2019 Global Social Impact Report and Transform to Net Zero press release
As the world’s largest retailer, Walmart has targeted zero emissions by 2040 and aims to protect, manage, or restore at least 50 million acres of land and one million square miles of ocean by 2030. The company plans to reach its ambitious goals without the use of carbon offsets by:
- Harvesting enough wind, solar and other renewable energy sources to power its facilities with 100% renewable energy by 2035
- Electrifying and zeroing out emissions from all of its vehicles, including long-haul trucks, by 2040
- Transitioning to low-impact refrigerants for cooling and electrified equipment for heating in its stores, clubs, and data and distribution centers by 2040
To date, Walmart powers around 29% of its operations with renewable energy and diverts approximately 80% of its waste from landfills and incineration globally. Because most of the company’s environmental impact comes from its supply chain, Walmart is also working with suppliers through its Project Gigaton initiative to avoid a gigaton of greenhouse gas emissions by 2030.
Sources: Walmart website and corporate press release issued September 21, 2020
Encycle is an energy management company that leverages IoT technology and machine learning to help commercial entities lower their HVAC electric usage and costs. By helping customers reduce their energy consumption, Encycle minimizes the negative impacts of CO2 while lowering the amount of renewable energy capacity that companies need to install and/or procure. Typical Encycle customers achieve a 10%-20% reduction in HVAC-related kW, kWh, and CO2, helping them make progress toward meeting their sustainability goals while mitigating risk.
Contributing author: Chris Hensley, Executive Vice President of Sales and Marketing, Encycle Corporation
1 Liu, Zhu, et al. “Near-Real-Time Monitoring of Global CO2 Emissions Reveals the Effects of the COVID-19 Pandemic.” Nature Communications, 14 Oct. 2020, www.nature.com/articles/s41467-020-18922-7.
2 “Cut Global Emissions by 7.6 % Every Year for Next Decade to Meet 1.5°C Paris Target – UN Report.” Unep.org, UNFCCC, 26 Nov. 2019, www.unep.org/news-and-stories/press-release/cut-global-emissions-76-%-every-year-next-decade-meet-15degc.
3 U.S. Energy Information Administration, 2020, U.S. Energy-Related Carbon Dioxide Emissions, 2019, www.eia.gov/environment/emissions/carbon/.
4 Ge, Mengpin, and Johannes Friedrich. “4 Charts Explain Greenhouse Gas Emissions by Countries and Sectors.” World Resources Institute, 5 May 2020, www.wri.org/blog/2020/02/greenhouse-gas-emissions-by-country-sector.
5 “Sources of Greenhouse Gas Emissions.” EPA, Environmental Protection Agency, 9 Sept. 2020, www.epa.gov/ghgemissions/sources-greenhouse-gas-emissions.
6 Winston, Andrew. “What 1,000 CEOs Really Think About Climate Change and Inequality.” Harvard Business Review, 24 Sept. 2019, hbr.org/2019/09/what-1000-ceos-really-think-about-climate-change-and-inequality.
7 Governance & Accountability Institute, 2020, 90% Of S&P 500 Index Companies Publish Sustainability Reports in 2019, G&A Announces in Its Latest Annual 2020 Flash Report, www.globenewswire.com/news-release/2020/07/16/2063434/0/en/90-of-S-P-500-Index-Companies-Publish-Sustainability-Reports-in-2019-G-A-Announces-in-its-Latest-Annual-2020-Flash-Report.html.